If you have just got started with your crypto investments then you may be learning quite a lot of new jargon at the moment with regards to those investments. One of the most common things that people will tell you too do with those funds is to ‘hodl’ which basically means hold on. What experts likemean by this is that you should be looking to hang on to your funds and not sell them regardless of what the price is doing.
Your investment is of course your own and you can do whatever you want with those funds. This is not financial advice but merely a description of what people mean when they tell you to hang on.
Long Term Boom
Those who believe in the future success of cryptocurrency like Bitcoin are in it for the long haul and it is widely considered that Bitcoin will one day reach heights of $500,000 or more. This is why these investors and experts will tell you to simply hang on, because that puts you in the perfect position to make the big bucks when the price eventually does boom like we have never seen it before. This is the main reason why so many simply invest and then hang on to their investments.
There are some small time investors out there who are trying to trade their way up to having more investment altogether. This however is something which is wrought with danger and it is recommended that you don’t try to trade your way up. The reason for this is that the market is just so volatile that you may end up losing money or actually trading down if you are not there at the right time. This is not only very hard to predict but it also means that you have to invest a huge amount of time in trading and watching the markets. Trading is hard enough with something like stocks and shares, yet this begins much, much harder if you are looking at doing it with crypto. The best advice is to get in at a price which you are comfortable with and then just let the investment ride out.
Keeping the Market Cap
Another great point to make here is that the more people who are sat on funds, the higher that the price is going to rise and the bigger the market cap becomes. If everyone is trading we are constantly finding a new price for the coin and more sales will eventually drive the price down. Naturally this needs to happen on a large scale in order for it to make an impact, but that is again why we are all better off holding on to the funds for the long term instead of looking to trade and sell quickly.
This is why so many say that the best way to manage your investments is to hodl, buying now, for the long term.